[edit] It goes without saying that if today’s bounce fails and SPX goes on to make new lows, the analysis from this morning is back on. Though 2090 is a valid bounce point as well. Let’s just let it unfold. Apologies for any minor mental whipsawing going on. :-( Also, the weakness in the precious metals is not looking very healthy, obviously.
Since the bounce has started so quickly and from a higher level than I thought it might (SPX did not make a lower low to early March and that is a caveat to the bear case), let’s revise the level from which lower risk short positions can be considered to 2090 per the visual resistance line drawn on the chart, with a stop above the March high of 2114.86.
We had originally noted 2065 to 2070 at the 50 day moving averages. I am not willing to bet against that potential Hammer candle at this juncture. Just a personal preference as I’m just fine holding cash and trading a little. Also, given the mixed signals (Biotech intact and bouncing, SOX dropping hard) in the markets, I may not jump into bearish positioning myself. I like cash (and a little biotech trading) just fine as if that has not been made clear already.
Precious metals analysis from this morning remains the same. There is a target of 180 +/- on HUI and nothing actionable yet beyond the bounce.
